Unauthorized Insurance

Unauthorized Insurance

An insurance policy sold by a company that has not received permission to do business in one's state. For example, if Tom lives in Oklahoma and an insurance company only authorized to operate in Texas sells Tom a policy, it has sold unauthorized insurance. Selling unauthorized insurance is illegal.
References in periodicals archive ?
IBAO believes the ministry should merely harmonize regulations enacted by the federal government in March 2012 that clarify that online retailing of unauthorized insurance products is prohibited as was originally intended in bank branches.
Unauthorized insurance companies commit fraud by illegally collecting premiums and disappearing before paying claims.
Jayne McLaughlin, the department's chief of staff, said the company had been fined, quoting the maximum fine for unauthorized insurance activity is $10,000 an occurrence.
The unlicensed reinsurance regulations also state that the carrier cannot use unearned premiums and claims reserves for unauthorized insurance in its financial stability calculations unless the reinsurer supports 100 percent of such amounts with appropriate letters of credit.
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